Share Pledge Agreement

EXHIBIT 10.70


S H A R E P L E D G E A G R E E M E N T


PLEDGOR: 1423280 Ontario Inc.


SECURED PARTY: Foothill Capital Corporation


CORPORATION: FutureLink Canada Corp.


2


SHARE PLEDGE AGREEMENT


PARTIES


PLEDGOR


Name: 1423280 Ontario Inc.


Address: 100 King Street West
1 Canadian Place, Suite 6600
Toronto, ON M5X 1B8


Fax No: (902) 425-6500


SECURED PARTY


Name: Foothill Capital Corporation


Address: 2450 Colorado Avenue,
Suite 3000 West
Santa Monica, California
90404


Fax No: (310) 453-7443


CORPORATION


Name: FutureLink Canada Corp.


Address: 2 Gibbs Road
Toronto, ON M9B 6L6


Fax No: (949) 672-3117


EFFECTIVE DATE


December 14, 2000 (the "Effective Date")


3


- 3 -


1. GRANT OF SECURITY INTEREST


For valuable consideration (the receipt and sufficiency of which each of the parties hereto hereby acknowledges) the Pledgor hereby assigns, pledges, hypothecates and grants to the Secured Party a security interest (to which the Personal Property Security Act (Ontario) and the regulations thereto, as the same may be amended from time to time (the "PPSA") applies) in and grants, mortgages and charges as and by way of a fixed and specific mortgage and charge to and in favour of the Secured Party, all of the Pledgor's rights, title and interests in and to 100 common shares in the capital of the Corporation owned by the Pledgor including without limitation all dividends or other distributions paid or payable in respect thereof from time to time (the "SHARES"), all pursuant to and in accordance with the provisions of this Agreement.


2. SECURED OBLIGATIONS


The security interests, mortgages and charges granted hereby secure all of the following (collectively, the "OBLIGATIONS"): both the performance and the payment to the Secured Party of all obligations, debts and liabilities (including, without limitation, on account of damages) of the Pledgor to the Secured Party, present or future, direct or indirect, absolute or contingent, liquidated or unliquidated, matured or not, wheresoever and howsoever incurred,


(a) whether arising under this or any other agreement (whether
written or oral), instrument or writing;


(b) whether arising from dealings between the Secured Party and the
Pledgor or from other dealings or proceedings by which the
Secured Party may be or become in any manner whatever a creditor,
obligee or promisee of the Pledgor;


(c) whether incurred by the Pledgor alone or with another or others;


(d) whether incurred by the Pledgor as principal, surety, indemnitor,
obligor or promissor; and


(e) whether such obligations, debts and liabilities are from time to
time reduced and thereafter increased or entirely extinguished
and thereafter incurred again,


all including, without limitation, all interest, commissions, legal and other costs, charges and expenses payable in connection with any and all of the foregoing and, in addition thereto, the Expenses (provided for and defined below).


3. ATTACHMENT


Each of the parties hereto acknowledges and confirms that the security interests, mortgages and charges granted hereby shall attach:


(a) forthwith upon the Effective Date with respect to the Shares in
which the Pledgor then has rights; and


4


- 4 -


(b) with respect to Substituted or Additional Shares (defined below)
forthwith upon the Pledgor first acquiring rights in such
Substituted or Additional Shares.


For greater certainty, without in any way limiting the above, each of the parties hereto acknowledges and confirms that they have not agreed to postpone the time for attachment of the said security interests, mortgages and charges.


4. PERFECTION


(a) Subject to paragraph 4(b) hereof, in furtherance of the security
interests, mortgages and charges hereby granted to the Secured
Party, the Pledgor agrees that contemporaneously with the
execution of this Agreement, it shall deliver the following to
the Secured Party upon the terms hereof:


(i) the relevant share certificate(s) representing all of the
Shares, duly registered in the name of the Pledgor, and
duly endorsed in blank for transfer hereunder and noting
conspicuously on the face thereof the following:


"TAKE notice that the ownership and transfer of the
shares represented by this Certificate are
restricted by and are subject to the provisions of
a Share Pledge Agreement dated December 14, 2000".


(ii) a transfer in blank of the Shares duly executed by the
Pledgor, the Pledgor hereby giving the Secured Party the
authority to complete the said transfer on its behalf upon
the occurrence of an Event of Default (defined below);


(iii) a certified copy of a resolution of the directors of the
Corporation approving the hypothecation and pledge of
the Shares to the Secured Party, the notation of the
Secured Party's interest on the relevant share
certificate(s) and in the shareholder ledgers of the
Corporation, any further transfers of the Shares made
pursuant to this Agreement, and the recording of same in
the books and records of the Corporation, which
resolution shall state that it may not be amended or
revoked without the prior written consent of the Secured
Party; and


(iv) signed, undated resignations addressed to the Corporation
pursuant to which each officer and/or director of the
Corporation resigns from all offices with the Corporation
and/or as a director on its board of directors.


(b) The Secured Party acknowledges and agrees that it shall hold the
Shares hereby delivered to it in accordance with the terms of
this Agreement.


5. RIGHT TO VOTE


So long as no Event of Default has occurred hereunder, the Pledgor shall be entitled to remain as shareholder of record of the Shares and to exercise all voting rights in respect of the Shares.


5


- 5 -


6. RIGHT TO DIVIDENDS, ETC.


So long as no Event of Default has occurred hereunder, the Pledgor shall be entitled to receive all dividends and other distributions paid or payable in respect of the Shares. In the event that the Pledgor receives any dividend or other distribution contrary to the foregoing it shall stand possessed of same in trust solely for the Secured Party and shall forthwith pay or deliver the same to the Secured Party to be applied in accordance with paragraph 15.


7. PLEDGOR'S WARRANTIES


The Pledgor hereby represents and warrants to and covenants with the Secured Party as follows and acknowledges that the Secured Party is, in part, relying upon such representations, warranties and covenants in accepting the security interests, mortgages and charges granted upon the terms of this Agreement:


(a) Ownership of Shares: The Pledgor is the absolute and beneficial
owner of the Shares and none of the Shares is held in the name of
any person other than the Pledgor, whether as agent, trustee or
other nominee for the Pledgor and the Shares are recorded in the
name of the Pledgor in the shareholder ledgers and registers in
the Corporation's minute book.


(b) No Encumbrances: The Shares are owned by the Pledgor with good
and marketable title thereto and they are and shall at all times
be kept free and clear of any and all mortgages, hypothecs,
pledges, claims, adverse claims, demands, liens, charges,
security interests, encumbrances, agreements, rights and equities
of any kind whatsoever other than those given by the Pledgor to
or in favour of Secured Party.


(c) Due Authorization: The Pledgor has the corporate power and
capacity to enter into this Agreement and to do all acts and
things as are required or contemplated hereunder to be done,
observed and performed by it.


(d) Right to Grant: The Pledgor has taken all necessary corporate
action to authorize the execution, delivery and performance of
this Agreement and the Pledgor shall at all relevant times have
the full right, power and authority to perform its obligations
hereunder and to grant the security interests, mortgages and
charges as herein provided.


(e) No Default: The entering into of this Agreement and the
performance by the Pledgor of its obligations hereunder does not
and will not contravene, breach or result in any default under
any agreement to which the Pledgor is a party or by which the
Pledgor or any of the Shares may be bound and will not result in
or permit the acceleration of the maturity of any indebtedness,
liability or obligation of the Debtor under any such agreement.


(f) No Agreements or Options: No person, firm or corporation other
than the Secured Party has any agreement or option (whether
written or oral) or any right or privilege (whether by law,
pre-emptive or contractual) capable of becoming an agreement or
option for the purchase of the Shares or any interests therein or
rights thereto.


6


- 6 -


(g) No Litigation: There is not pending any court, administrative,
regulatory or other action or legal proceeding of any sort
either to restrain or otherwise prevent in any manner the
Pledgor from effectually and legally hypothecating and pledging
the Shares to the Secured Party free and clear of any and all
mortgages, hypothecs, pledges, claims, adverse claims, demands,
liens, charges, security interests, encumbrances, agreements,
rights and equities of any kind whatsoever or any suit, action
or proceeding the effect of which would be to cause a lien to
attach to the Shares or to divest title to the Shares in any
manner whatsoever.


(h) Issued Capital: The only issued and outstanding shares in the
capital of the Corporation owned by the Pledgor are the Shares
and no person, firm or corporation has any agreement or option
(whether written or oral) or any right or privilege (whether by
law, pre-emptive or contractual) capable of becoming an
agreement, including convertible securities, warrants or
convertible obligations of any nature for the purchase,
subscription, allotment or issuance of any of the unissued shares
in the capital of the Corporation.


8. PLEDGOR'S COVENANTS


The Pledgor covenants and agrees with the Secured Party that:


(a) Obligations: The Pledgor shall pay, perform, satisfy, fulfill and
discharge the Obligations when due.


(b) No Transfers or Encumbrances: The Pledgor shall not either
directly or indirectly (including by way of corporate
reorganization, amalgamation or otherwise) sell, transfer,
convey, assign, exchange, convert or in any manner dispose of,
pledge or in any manner encumber any of the Shares without the
prior written consent of the Secured Party, except as expressly
permitted or required elsewhere herein.


(c) Substituted or Additional Shares: In the event any substituted
or additional shares in the capital of the Corporation are
received or acquired (directly or indirectly) by or on behalf of
the Pledgor, whether as a result of a share issuance,
subdivision, consolidation, conversion, reclassification, stock
dividend, transfer, sale, reorganization, amalgamation or
otherwise (the "SUBSTITUTED OR ADDITIONAL SHARES"), the Pledgor
shall stand possessed of the Substituted or Additional Shares in
trust for the Secured Party and shall forthwith deliver to the
Secured Party the certificate or certificates representing the
...